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The Solow Productivity Paradox in Historical Perspective

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  • Crafts, Nicholas

Abstract

A growth accounting methodology is used to compare the contributions to growth in terms of capital-deepening and total factor productivity growth of three general-purpose technologies, namely, steam in Britain during 1780-1860, electricity and information and communications technology in the United States during 1899-1929 and 1974-2000, respectively. The format permits explicit comparison of earlier episodes with the results for ICT obtained by Oliner and Sichel. The results suggest that the contribution of ICT was already relatively large before 1995 and it is suggested that the true productivity paradox is why economists expected more sooner from ICT.

Suggested Citation

  • Crafts, Nicholas, 2002. "The Solow Productivity Paradox in Historical Perspective," CEPR Discussion Papers 3142, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:3142
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    References listed on IDEAS

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    More about this item

    Keywords

    Growth accounting; General purpose technologies; Productivity paradox;
    All these keywords.

    JEL classification:

    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

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